Cayman Auto has $600,000 of debt outstanding, and it pays an interest rate of 8% annually: Cayman
Question:
Cayman Auto has $600,000 of debt outstanding, and it pays an interest rate of 8% annually: Cayman Auto's annual sales are $3 million, its average tax rate is 25%, and its net profit margin is 3%. If the company does not maintain a TIE ratio of at least 5 times, its bank will refuse to renew the loan, and bankruptcy will result. What is Cayman Auto's TIE ratio?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
TIE EBITINT so find EBIT and INT Inter...View the full answer
Answered By
Bhartendu Goyal
Professional, Experienced, and Expert tutor who will provide speedy and to-the-point solutions. I have been teaching students for 5 years now in different subjects and it's truly been one of the most rewarding experiences of my life. I have also done one-to-one tutoring with 100+ students and help them achieve great subject knowledge. I have expertise in computer subjects like C++, C, Java, and Python programming and other computer Science related fields. Many of my student's parents message me that your lessons improved their children's grades and this is the best only thing you want as a tea...
2+ Reviews
10+ Question Solved
Related Book For 
Financial Management Theory And Practice
ISBN: 978-0176583057
3rd Canadian Edition
Authors: Eugene Brigham, Michael Ehrhardt, Jerome Gessaroli, Richard Nason
Question Posted:
